This is a very complex issue in the UK. It's all down to something called "Mutual Trading", and is usually used to gain various tax exemptions. Political parties are allowed to be non profit organisations by HMRC as the funds generated are used for campaigning. In my view, and that of many others, private Golf Clubs should not be allowed to avoid taxes in this way.

Non profit organisations used to be only those that benefited or gave a service to the general public. Amnesty International, Oxfam, Rotary International, the Red Cross and Red Crescent organizations, UNESCO, World Wide Fund for Nature etc.
One can hardly call an upmarket private golf club one for the general public. Perhaps by legal definition they are NPO's but that is not within the spirit of the intention.

So your local bridge club or your local model railroad club or your local computer users group or horror upon horror the local country club is a 501(c)(7)!

Quite correct. But obviously as can be seen, this also applies to multi million dollar private golf clubs. They are not breaking the law, but they are simply using it to their advantage because they can. There is of course a very simple answer isn't there?

Amend the rules so that Tax reliefs are only allowed under category 501(c)(7) to those with a turnover of less than $1000 a year. But of course as been already alluded to, those that make the tax laws have no interest in doing that as most are probably members of these upmarket clubs.

It is right that this should be highlighted, but don't expect any changes soon!

So your local bridge club or your local model railroad club or your local computer users group or horror upon horror the local country club is a 501(c)(7)!

Quite correct. But obviously as can be seen, this also applies to multi million dollar private golf clubs. They are not breaking the law, but they are simply using it to their advantage because they can. There is of course a very simple answer isn't there?

Amend the rules so that Tax reliefs are only allowed under category 501(c)(7) to those with a turnover of less than $1000 a year. But of course as been already alluded to, those that make the tax laws have no interest in doing that as most are probably members of these upmarket clubs.

It is right that this should be highlighted, but don't expect any changes soon!

Ah another who knee jerks. The model railroad club often buys a building to put up their layout. That is far over $1000 a year.

I suspect a lot of you think that just because they are not for profit that the money they collect is tax deductible. It isn't. They aren't a charity. Any employee's pay income tax. They pay sales tax and real estate tax. There is no profit, no dividends. No profit, no income tax.

I think most folks think of not for profits as liberal "help the poor" shoestring budget organizations that operate out of rented space in a dingy part of town.

Clearly this isn't always the case

Yes, frequently they are a charity set up to enrich the people running it by spending 99% of the donations on the executive salaries and fund raising expenses and drop as few dimes as possible on the charity cause they solicit for. All perfectly legal of course.
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